The more spontaneous an action is, the more unpredictable its outcome will be, making it harder to foresee the final result. However, if an action is well-planned, we can, in most cases, at least define the boundaries of the expected outcome.
Think of it like designing a building. If I carefully plan the structure, there's a high likelihood that the final construction will be stable, meet regulations, and not collapse. But if I build without a plan, the building will likely fail—collapsing in a storm, hurricane, or earthquake.
The same principle applies to sales. At the start of each year, sales professionals—including individual reps and managers—are assigned a territory where they are responsible for generating revenue. Their performance is measured against a quota, and they must strive to achieve (or exceed) their expected revenue target.
Since sales performance is measured within a fixed timeframe—typically a year, but often broken down into quarters (or even months in some cases)—sales professionals need a clear strategy to maximize results. Achieving the best possible outcome requires accurate forecasting.
Just like in the building example, sales leaders—including Sales Managers, VPs, CROs, and even CEOs—must create a structured plan to reach their assigned targets. If they don’t, they risk failure—or at the very least, uncertainty about how to achieve their goals.
The Importance of Forecasting
One of the key reasons planning is essential is forecasting. While this article won’t go into the full details of what forecasting means for a company and why it’s so critical, it’s worth noting that businesses rise and fall based on their forecasts.
A simple way to understand this is by following a publicly traded company of your choice. If a company projects certain revenue expectations and then fails to meet them, investor confidence drops—often with serious consequences.
Back to Planning
As mentioned earlier, planning is crucial for success. This applies to all sales professionals, whether they work in inbound or outbound sales.
Even though inbound sales reps don’t choose their accounts—since the company provides them with leads—they still control how they manage their assigned territory. Understanding this and preparing accordingly can make the difference between success and failure.
How to Plan Your Territory – Best Practices
In this article, I’ll focus on the perspective of an individual sales rep. A sales manager’s approach is typically an aggregate view of their entire team’s performance.
Territory planning starts with:
- Receiving your assigned accounts or regions
- Understanding your annual targets
The goal should always be to aim for 130% of quota—yes, 130%.
Why Aim for 130%?
Because:
- You should always aim higher than your target.
- No plan is perfect—unexpected challenges will arise, so having a buffer increases your chances of success.
Now, let’s break down the 130% target into components using a pyramid model:
- 4 Large Deals – 30%
- Mid-Sized Deals – 30%
- Run-Rate Business – 40%
This structure varies across companies, but in most cases, businesses sell a small set of core products (typically between one and three). Not all deals will be of the same size, so this hierarchical breakdown applies in nearly every scenario.
Where Will the Deals Come From?
Now, the big question: How do you generate these deals?
This is where territory analysis and business strategy come in. The deeper and more precise your analysis, the stronger your plan will be, leading to a higher probability of success.
Here are the key factors to analyze:
- Strategic Goals – What are the company’s main investment priorities for the year?
- This is a key indicator of where they will allocate their time and money.
- Typically, companies focus on a few major objectives.
- When purchasing a product, executive leadership will ask:
How does this contribute to our strategic goals? - Even a high-ROI solution may be ignored if it doesn’t align with the company’s strategy.
- Growth Forecast – For existing customers, understanding growth trends can:
- Predict expansion opportunities in product usage.
- Provide insight into run-rate business potential.
- Indicate whether a company is investing in growth or cutting costs.
- Companies focused on cost-cutting are less likely to increase spending, making them lower-priority targets.
- Budget Availability –
- Even though budgets are set at the beginning of the year, understanding their allocation is critical.
- Budget constraints directly impact purchasing decisions.
- Having an open conversation with procurement can quickly clarify whether a deal is even worth pursuing.
The Two Core Elements of Sales Success
Sales success is built on two key pillars:
- Planning and Execution – This should be treated as a precise science. Structured, data-driven planning will yield results.
- Creativity – A strong plan is essential, but adaptability and creative problem-solving will set top performers apart.
By combining disciplined planning with strategic flexibility, sales professionals can maximize their success.
Good luck!
